Tuesday, April 6, 2010

The following is the accounting definition and explanation of a fiscal year:

The year long accounting period used by a company is known as its fiscal year. The maximum length of this accounting period is generally twelve months which includes all transactions that have taken place in the accounting cycle or fiscal year

A year-long accounting period that ends when its business activities are at their lowest point in the annual operating cycle is called a natural business year. It is possible to see the long-term financial history of a company by reviewing balance sheets that are prepared every year. The history of operations for each fiscal year is shown in the income statement.